WHAT ENTERTAINMENT
LAWYERS CHARGE
How much should fees be for music attorney services?
Joey Scavuzzo
If you’re in the market for an entertainment attorney in the
music business… Congratulations! You’re on the rise, finally getting paid for
your craft and need someone in your corner looking out for your best interests.
Few make it this far, but mo’ money, mo’ problems, right?
Anyone can find an attorney today. Google exists. But the
bigger questions loom: what are the payment options, what should you expect to
pay and is it reasonable? The barriers to this knowledge are high so let’s tear
them down and empower you with all the information you need.
What are music attorney fee payment options?
According to California
Legal Forms – Transaction Guide, Matthew Bender, a leading publisher of
legal analysis and research information, explains that entertainment attorney
fees are typically paid in one of four ways:
1.
A retainer
2.
An hourly rate
3.
A combination of an hourly rate and a percentage
of your gross compensation
4.
Contingency fees based on gross income.
What should you expect to pay for a music attorney?
When it comes to an hourly rate, Donald S. Passman, author
of All You Need to Know About the Music Business, Eighth Edition,
states, “Most lawyers in the music business don’t charge on just an hourly
basis. For the ones that do, the rates are from $150 per hour for new lawyers,
up to $600 or more for biggies[1].”
Since many entertainment clients can’t afford to retain an
attorney on an hourly basis, they and their attorney instead often agree to a
contingency fee arrangement.
Kenneth Abdo, a partner at the firm Fox Rothschild LLP along
with Jack Saul, a professor of law at University of Akron, note in their
article Entertainment Law Ethics, “A customary contingent fee ranges from 5% to
10% of the defined gross compensation of the client and rarely exceeds 10%. The
exact percentage depends, in part, on the client’s record for commercial or
critical success and the likelihood that the lawyer’s efforts will be
successful. For example, it is reasonable with a superstar to take a lower
percentage of the gross compensation and with a new or “baby act” to insist on
10%. Successfully shopping a new artist to a recording contract with a small,
local, independent record company is a situation in which a lawyer might charge
10% of the artist’s gross compensation.[2]”
This is further supported by LAW AND BUSINESS OF THE
ENTERTAINMENT INDUSTRIES, Fifth Edition, by Donald E. Biederman, et. al.
(the prevailing text used in law schools), stating, “A customary contingency fee ranges from 5%
to 10% of the defined compensation earned by the client and rarely exceeds 10%[3].”
But that doesn’t mean it can’t. There is no case law or precedent defining a
specific ceiling. For example, it is common for contingency lawyers in personal
injury cases to take 33.33% and employment lawyers to take 40% of the total
amount recovered. [4]
And this leads us to our final section…
Is your attorney’s fee percentage reasonable?
According to the American Bar Association’s Model Rules of
Professional Conduct (MRPC), the ethical code governing attorneys, Rule 1.5(a)(1)-(8) states the attorney can consider the
following criteria in determining a reasonable fee: “the time and labor
required, the novelty and difficulty of the questions involved, the skill
requisite to perform the legal service properly, the fee customarily charged in
the locality for similar legal services; the amount involved and the results
obtained;, the experience, reputation, and the ability of the lawyer performing
the services required; and whether the fee is fixed or contingent.[5]”
In fact, some lawyers may require a retainer or deposit payment in addition to
a percentage of the deal.[6]
What that says is that music
attorneys have a lot of flexibility and protection when it comes to charging
their fees. Simply put, an attorney with years of experience and a proven track
record can, legally and ethically, charge higher rates.
So, when hiring a music attorney, you want a specialist, someone experienced with music contracts. They will understand the nuances of any deal. And you should want a professional who regularly deals with agents, managers, producers, and record companies. Like entertainment attorney Gordon Firemark says, “Their relationships with executives… can mean the difference between an average deal or a favorable one.[7]” But you should expect to pay a premium for this expertise.
[1]
Donald Passman: All You Need to Know About the Music Business; https://books.google.com/books?id=smbiogvIt9AC&pg=PA50&dq=charge+on+just+an+hourly+basis&hl=en&ppis=_c&sa=X&ved=2ahUKEwi5p8G2_cfoAhUdJzQIHYCLCbYQ6AEwAXoECAIQAg#v=onepage&q=charge%20on%20just%20an%20hourly%20basis&f=false
[2]
Kenneth Abdo & Jack Saul, “Entertainment Law Ethics” https://law.marquette.edu/assets/sports-law/Entertainment%20Law%20Ethics%20%28Abdo%20%26%20Sahl%29-C1.pdf
[3]
Donald Biederman: Law and Business of the Entertainment Industries: Fifth Edition
(2001) https://books.google.com/books?id=hKguqdfT3eMC&pg=PA18&dq=the+defined+compensation+earned+by+the+client&hl=en&ppis=_c&sa=X&ved=2ahUKEwjOrqH7_MfoAhV2GjQIHc3zBvwQ6AEwAHoECAYQAg#v=onepage&q=the%20defined%20compensation%20earned%20by%20the%20client&f=false
[4] Hutchinson
and Stoy, “Everything You Need to Know About Contingency Fee and No Win, No Fee
Lawyers https://www.warriorsforjustice.com/everything-need-know-contingency-fee-no-win-no-fee-lawyers/
[5] American
Bar Association; Model Rules of Professional Conduct: Rule 1.5, https://www.americanbar.org/groups/professional_responsibility/publications/model_rules_of_professional_conduct/rule_1_5_fees/
[6]
Wallace Collins, “How do you know When you need an Entertainment Lawyer?” 2015.
https://www.digitalmusicnews.com/2015/05/13/how-do-you-know-when-you-need-an-entertainment-lawyer/
[7] Gordon
Firemark, “Assembling a Winning Team: The Entertainment Lawyer,” 2004. https://firemark.com/2004/05/24/assembling-a-winning-team-the-entertainment-lawyer/
